Pharoah Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1,2022, Job 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $18,000,direct labor $10,800, and manufacturing overhead $14,400. As of January 1, Job 49 had been completed at a cost of $81,000 and waspart of finished goods inventory. There was a $13,500 balance in the Raw Materials Inventory account on January 1.During the month of January, Pharoah Company began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50were sold on account during the month for $109,800 and $142,200, respectively. The following additional events occurred during themonth.1.Purchased additional raw materials of $81,000 on account.2.Incurred factory labor costs of $63,000.Incurred manufacturing overhead costs as follows: depreciation expense on equipment $10,800; and various othermanufacturing overhead costs on account $14,400.3.4.Assigned direct materials and direct labor to jobs as follows.Job No.Direct MaterialsDirect Labor50$9,000$4,5005135,10022,5005227,00018,0005.Assigned indirect materials of $15,300 and indirect labor of $18,000.Calculate the predetermined overhead rate for 2022, assuming Pharoah Company estimates total manufacturing overhead costsof $756,000, direct labor costs of $630,000, and direct labor hours of 18,000 for the year.Predetermined overhead rate120 Open Job cost sheets for Jobs 50, 51, and 52. Enter the January 1 balances on the Job cost sheet for Job 50. Post allcosts to the job cost sheets as necessary.Job No. 50DateDirect MaterialsDirect LaborManufacturingBeg.Jan.%2$Cost ofcompleted jobDirectmaterialsDirect laborManufacturingoverheadTotal costJob No. 51DateDirect MaterialsDirect LaborManufacturinsJan.Cost ofcompleted jobDirectmaterialsDirect laborManufacturingoverheadTotal costJob No. 52DateDirect MaterialsManufacturing OverheadDirect LaborJan.$2$Prepare the Journal entry to record the completion of any Job(s) during the month. (List all debit entrlesbefore credit entries. Credit account titles are automaticalIly indented when amount is entered.Do not Indent manually.)Account Titles and ExplanationDebitCrediteTextbook and MediaList of AccountsPrepare the journal entries to record the sale of any job(s) during the month. (List all debit entries beforecredit entries. Credit account titles are automatically indented when amount is entered. Do notindent manually.)No.Account Titles and ExplanationDebitCredit(1)(To record sale of jobs)(2)(To record cost of jobs)cTextbook and MediaList of AccountsWhat is the balance in the Finished Goods Inventory account at the end of the month? (Hint: Use a T-account forFinished Goods Inventory.) What does this balance consist of?Finished Goods Inventory

Name: Pharoah Company uses a job order cost system and applies overhead to
Uploaded: 2024-03-20T06:32:49.000Z
Channel: Bartleby
Description: Pharoah Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1,2022, Job 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct mate

Predetermined Overhead Rate:- A predetermined overhead rate is an allocation rate that's wont to…

Business

Accounting

Pharoah Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2022, Job 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $18,000, direct labor $10,800, and manufacturing overhead $14,400. As of January 1, Job 49 had been completed at a cost of $81,000 and was part of finished goods inventory. There was a $13,500 balance in the Raw Materials Inventory account on January 1. During the month of January, Pharoah Company began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50 were sold on account during the month for $109,800 and $142,200, respectively. The following additional events occurred during the month. 1. Purchased additional raw materials of $81,000 on account. 2. Incurred factory labor costs of $63,000. Incurred manufacturing overhead costs as follows: depreciation expense on equipment $10,800; and various other manufacturing overhead costs on account $14,400. 3. 4. Assigned direct materials and direct labor to jobs as follows.

Pharoah Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2022, Job 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $18,000, direct labor $10,800, and manufacturing overhead $14,400. As of January 1, Job 49 had been completed at a cost of $81,000 and was part of finished goods inventory. There was a $13,500 balance in the Raw Materials Inventory account on January 1. During the month of January, Pharoah Company began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50 were sold on account during the month for $109,800 and $142,200, respectively. The following additional events occurred during the month. 1. Purchased additional raw materials of $81,000 on account. 2. Incurred factory labor costs of $63,000. Incurred manufacturing overhead costs as follows: depreciation expense on equipment $10,800; and various other manufacturing overhead costs on account $14,400. 3. 4. Assigned direct materials and direct labor to jobs as follows.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter5: Product And Service Costing: Job-order System

Section: Chapter Questions

Problem 21E: Lorrimer Company has a job-order cost system. The following debits (credits) appeared in the...

See similar textbooks

Similar questions

Channel Products Inc. uses the job order cost system of accounting. The following is a list of the jobs completed during March, showing the charges for materials issued to production and for direct labor. Assume that factory overhead is applied on the basis of direct labor costs and that the predetermined rate is 200%. Required: Compute the amount of overhead to be added to the cost of each job completed during the month. Compute the total cost of each job completed during the month. Compute the total cost of producing all the jobs finished during the month.
Lorrimer Company has a job-order cost system. The following debits (credits) appeared in the Work-in-Process account for the month of June. During the month of June, direct labor totaled 30,000 and 24,000 of overhead was applied to production. Finished Goods was debited 100,000 during June. Lorrimer Company applies overhead at a predetermined rate of 80% of direct labor cost. Job number 83, the only job still in process at the end of June, has been charged with manufacturing overhead of 3,400. What was the amount of direct materials charged to Job number 83? a. 3,400 b. 4,250 c. 8,350 d. 7,580
Rulers Company is a neon sign company that estimated overhead will be $60,000, consisting of 1,500 machine hours. The cost to make Job 416 is $95 in neon, 15 hours of labor at $13 per hour, and five machine hours. During the month, it incurs $95 in indirect material cost, $130 in administrative labor, $320 in utilities, and $350 in depreciation expense. What is the predetermined overhead rate if machine hours are considered the cost driver? What is the cost of Job 416? What is the overhead incurred during the month?
Luna Manufacturing Inc. completed Job 2525 on May 31, and there were no jobs in process in the plant. Prior to June 1, the predetermined overhead application rate for June was computed from the following data, based on an estimate of 5,000 direct labor hours: The factory has one production department and uses the direct labor hour method to apply factory overhead. Three jobs are started during the month, and postings are made daily to the job cost sheets from the materials requisitions and labor-time records. The following schedule shows the jobs and amounts posted to the job cost sheets: The factory overhead control account was debited during the month for actual factory overhead expenses of 27,000. On June 11, Job 2526 was completed and delivered to the customer using a mark-on percentage of 50% on manufacturing cost. On June 24, Job 2527 was completed and transferred to Finished Goods. On June 30, Job 2528 was still in process. Required: 1. Prepare job cost sheets for Jobs 2526, 2527, and 2528, including factory overhead applied when the job was completed or at the end of the month for partially completed jobs. 2. Prepare journal entries as of June 30 for the following: a. Applying factory overhead to production. b. Closing the applied factory overhead account. c. Closing the factory overhead account. d. Transferring the cost of the completed jobs to finished goods. e. Recording the cost of the sale and the sale of Job 2526.
Queen Bees Honey, Inc., estimated its annual overhead to be $110,000 and based its predetermined overhead rate on 27,500 direct labor hours. At the end of the year, actual overhead was $106,000 and the total direct labor hours were 29,000. What is the entry to dispose of the over applied or under applied overhead?
Gerken Fabrication Inc. uses the job order cost system of accounting. The following information was taken from the companys books after all posting had been completed at the end of March: a. Compute the total production cost of each job. b. Prepare the journal entries to charge the costs of materials, labor, and factory overhead to Work in Process. c. Prepare the journal entry to transfer the cost of jobs completed to Finished Goods. d. Compute the unit cost of each job. e. Compute the selling price per unit for each job, assuming a mark-on percentage of 50%.
Entries for costs in a job order cost system Royal Technology Company uses a job order cost system. The following data summarize the operations related to production for March: A. Materials purchased on account, 770,000. B. Materials requisitioned, 680,000, of which 75,800 was for general factory use. C. Factory labor used, 756,000, of which 182,000 was indirect. D. Other costs incurred on account for factory overhead, 245,000; selling expenses, 171,500; and administrative expenses, 110,600. E. Prepaid expenses expired for factory overhead were 24,500; for selling expenses, 28,420; and for administrative expenses, 16,660. F. Depreciation of factory equipment was 49,500; of office equipment, 61,800; and of office building, 14,900. G. Factory overhead costs applied to jobs, 568,500. H. Jobs completed, 1,500,000. I. Cost of goods sold, 1,375,000. Instruction Journalize the entries to record the summarized operations.
Leen Production Co. uses the job order cost system of accounting. The following information was taken from the companys books after all posting had been completed at the end of May: a. Compute the total production cost of each job. b. Prepare the journal entry to transfer the cost of jobs completed to Finished Goods. c. Compute the selling price per unit for each job, assuming a mark-on percentage of 40%. d. Prepare the journal entries to record the sale of Job 1065.
During the month, Job Arch2 used specialized machinery for 350 hours and incurred $700 in utilities on account. $400 in factory depreciation expense, and $200 in property tax on the factory. Prepare journal entries for the following: A. Record the expenses incurred. B. Record the allocation of overhead at the predetermined rate of $1.50 per machine hour.
York Company Is a machine shop that estimated overhead will be $50,000, consisting of 5,000 hours of direct labor. The cost to make job 0325 is $70 in aluminum and two hours of labor at $20 per hour. During the month. York incurs $50 in indirect material cost. $150 in administrative labor, $300 in utilities, and $250 in depreciation expense. What is the predetermined overhead rate if direct labor hours are considered the cost driver? What is the cost of Job 0325? What is the overhead incurred during the month?
During August, Skyler Company worked on three jobs. Data relating to these three jobs follow: Overhead is assigned on the basis of direct labor hours at a rate of 2.30 per direct labor hour. During August, Jobs 39 and 40 were completed and transferred to Finished Goods Inventory. Job 40 was sold by the end of the month. Job 41 was the only unfinished job at the end of the month. Required: 1. Calculate the per-unit cost of Jobs 39 and 40. (Round unit costs to nearest cent.) 2. Compute the ending balance in the work-in-process inventory account. 3. Prepare the journal entries reflecting the completion of Jobs 39 and 40 and the sale of Job 40. The selling price is 140 percent of cost.
On August 1, Cairle Companys work-in-process inventory consisted of three jobs with the following costs: During August, four more jobs were started. Information on costs added to the seven jobs during the month is as follows: Before the end of August, Jobs 70, 72, 73, and 75 were completed. On August 31, Jobs 72 and 75 were sold. Required: 1. Calculate the predetermined overhead rate based on direct labor cost. 2. Calculate the ending balance for each job as of August 31. 3. Calculate the ending balance of Work in Process as of August 31. 4. Calculate the cost of goods sold for August. 5. Assuming that Cairle prices its jobs at cost plus 20 percent, calculate Cairles sales revenue for August.